Mapping Maryland’s Comparative Advantages: Frederick County

In my last blog post, I talked about Maryland’s advantage compared to other states in the Scientific R&D Services industry and saw how a high location quotient for the industry was correlated with the presence of Maryland’s military installations and federal research facilities. Today, I will focus on Frederick County, the county with the second-highest location quotient for Scientific R&D Services in Maryland.

Frederick County is one of the most interesting counties in Maryland. The county is a mix of rural, urban, and suburban jurisdictions—perhaps more than any other county in the state. At the center of Frederick County is the City of Frederick, the second-largest incorporated municipality in the state. Surrounding historic downtown Frederick are suburbs and small communities where many residents live and commute to either Baltimore or Washington DC. Much of the county remains rural, dotted with small family farms and mountainous parks.

This mix of rural and urban areas within the county is clearly visible when looking at the county’s location quotients (defined in a previous blog post). Below is a table showing the eleven industries with the highest location quotients in Frederick County.

Industry

Location Quotient

Employment, 2015 Average Annual Wage, 2015 Percent Change in Employment, 2011–2015
Other animal production 10.01  136.00 $38,415 –28.4%
Scientific research and development services 6.25  2,907.00 $83,521 4.9%
Nondepository credit intermediation 4.60  1,919.00 $85,330 –6.7%
Building foundation and exterior contractors 2.92  1,636.00 $53,537 15.1%
Residential building construction 2.83  1,381.00 $56,128 44.8%
Building finishing contractors 2.79  1,443.00 $47,911 42.7%
Book, periodical, and music stores 2.73  172.00 $46,812 –9.0%
Lumber and const. supply merchant wholesalers 2.50  368.00 $56,515 31.4%
Other specialty trade contractors 2.31  993.00 $52,043 37.0%
Beer, wine, and liquor stores 2.13  229.00 $25,323 11.7%
Cattle ranching and farming 2.09  226.00 $30,910 75.2%

Industries with the highest location quotients in Frederick County

Two of the eleven industries with the highest location quotient in Frederick County are rural industries: Cattle Ranching and Farming (primarily dairy farms) and Other Animal Production (a category that includes the county’s numerous horse breeding, training, and stables). In fact, Other Animal Production has the highest location quotient in Frederick County at 10.0. Frederick County’s dairy industry is strong as well: the county estimates that one third of all milk produced in the state comes from Frederick County.

There are several reasons for Frederick County’s strengths in dairy farming and horse breeding. Perhaps the most important asset the county has is water. Dairy farms require access to a steady supply of clean water, and Frederick County has numerous springs and creeks flowing from its hills. Unlike counties to the east, such as Harford County or areas of Southern Maryland, the county does not rely heavily on getting water from aquifers, and this has allowed the industry to thrive in Frederick. Additionally, Frederick County has access to plenty of nutrient-rich land, which makes for excellent pasture land.

The county’s location has also allowed these industries to thrive in Frederick. Frederick is less than an hour from Baltimore and Washington DC, two major economic powerhouses in the region. This means Frederick dairy farms have a lot of customers relatively close by, helping to minimize costs and maximize freshness. Proximity to these cities has also helped the county’s equine industry. Horse ownership is often reserved for those with higher incomes, and incomes in the Baltimore-Washington MSA are higher than the national average.

The second highest location quotient in the county is Scientific R&D Services. Approximately 2,900 people were employed in Scientific R&D Services in Frederick County in 2015, the last full year data was available for. This is a 4.9 percent increase over the 2,770 workers in the industry in 2011. The map below shows the location of the Scientific R&D Services jobs in Frederick County by zip code, with darker colors representing more workers.

Map showing the location of workers in Scientific R&D Services by zip code in Frederick County

Over two-thirds of the jobs in Scientific R&D Services are located in zip code 21702, the zip code containing Fort Detrick and the Frederick National Laboratory for Cancer Research. Fort Detrick’s focus on biodefense has attracted numerous defense contractors to the area. For example, Battelle administers the National Biodefense Analysis & Countermeasures Center. Leidos Biomedical Research, the largest private employer in the county, is the technical support contractor for the Frederick National Laboratory for Cancer Research.

In addition to several military installations, the factors that have helped Frederick’s dairy and equine industries have helped its strong biomedical community. An abundance of clean water is needed in many of the life sciences facilities in the area. Frederick County’s proximity to Baltimore and Washington DC also helps support these industries. Locating in Frederick allows businesses to draw from the skilled labor available in Baltimore and Washington DC. Frederick companies can also transport products quickly across the country and globe through the area’s three major nearby airports, the Port of Baltimore, through freight rail, or by truck on I-70 and nearby I-81.

Finally, Frederick County has the benefit of being close to major markets and government agencies while being cheaper than many other suburban markets. The average cost of office space in Frederick County was $11.52 per square foot in 2015. In contrast, the average cost of office space per square foot was over $20 in Prince George’s County and over $25 in Montgomery County.

Frederick County’s economy is growing and proves that in many ways it really is all about “location, location, location.” When considering why an industry exists in one area versus another, Frederick County proves that looking at geography is often an ideal starting point.

Do you have an industry or county you’d like us to examine in more depth? Let us know in the comments below or email me at msiers@towson.edu. The Regional Economic Studies Institute has provided Maryland with in-depth analysis of the region for the past 25 years and our team of economists, survey experts, and GIS specialists is ready to provide you with the tools you need to understand how to navigate an ever-changing economy. Contact us today to find out more about the services we offer.

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Michael Siers
Michael Siers is a senior economist at the Regional Economics Studies Institute. He is charged with designing qualitative and quantitative research methodologies to better understand impacts to the Maryland and regional economies. Michael's posts focus on RESI projects.